Effects of knowledge accumulation strategies through experience and experimentation on firm growth

Tai-ho, Kang; Baek, Chulwoo; Lee, Jeong‐Dong

doi:10.1016/j.techfore.2019.04.003

Cited by 34 publications

(41 citation statements)

References 62 publications

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“…Business experience displays a significant role in opportunity recognition and SMEs' performance. As pointed out by Kang et al (), experienced managers enjoy superior performance and a better position in the market. The findings favor De Clercq et al () who revealed that experienced managers can easily find new opportunities in the markets, and they are more aware of the market trends and fluctuation.…”

Section: Discussionmentioning

confidence: 90%

“…The performance of ventures is significantly influenced by the founder industry and market experience (Dencker & Gruber, ). It is the experience that differs one firm from others in terms of performance and sustainable competitive advantage because experienced staffs are proficient of procuring peripheral information and resources that are essential for high profitably (Kang, Baek, & Lee, ). Experience plays a very crucial role in the performance of SMEs because experienced managers make appropriate decisions.…”

Section: Literature Reviewmentioning

confidence: 99%

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Business experience or Financial Literacy? Which one is better for opportunity recognition and superior performance?

Anwar

Ullah

2020

Bus Strat Dev

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Recognition of useful opportunities is very crucial for small and medium‐sized enterprises' (SMEs') survival and growth in the competitive environment. However, the majority of SMEs cannot easily recognize new opportunities in the turbulent markets due to a lack of managerial competencies and knowledge. Several studies have been carried out to unleash the determinants of opportunity recognition that configure SMEs' success, but the results are disjointed. In particular, the mediating role of opportunity recognition between business experience, financial literacy, and SME performance has been missed. This study aims to test if either financially literate or experienced managers can recognize new opportunities that result in high performance. For testing the hypotheses, we surveyed 232 Pakistani SMEs from the manufacturing, trading, and service sectors. After performing the structural equation modeling, we found that financial literacy and business experience are the substantial prognosticators of opportunity recognition and SMEs' performance. Opportunity recognition shows a partial mediating role between financial literacy and SMEs performance as well as between business experience and SMEs performance. However, this research endorses that business experience is more vital for high performance as compared to financial literacy whereas in terms of opportunity recognition financial literacy is more crucial as compared to experience. This study recommends the enterprises to hire the financially literate and experienced managers as both display a prominent role in the identification of opportunities and high performance. Further implications are discussed.

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Section: Discussionmentioning

confidence: 90%

Section: Literature Reviewmentioning

confidence: 99%

Business experience or Financial Literacy? Which one is better for opportunity recognition and superior performance?

Anwar

Ullah

2020

Bus Strat Dev

View full text Add to dashboard Cite

show abstract

“…Experience managers accumulate knowledge related to market, products and customers which help them in decision making process and significant influence business performance [95]. For competitiveness and survival, business organizations need innovative products.…”

Section: Mediating Role Of New Product Developmentmentioning

confidence: 99%

“…Managerial experience differentiates firms from one another in term of sustainable competitive advantage and performance. Because experienced managers are able to acquire useful resources and have more knowledge of external markets to seize opportunities ( [95]. Learning from experience facilitates their capacity to manage resources in a useful way that can give high profit and sustainable competitive advantage [100].…”

Section: Mediating Role Of New Product Developmentmentioning

confidence: 99%

Unpacking the importance of intangible skills in new product development and sustainable business performance; strategies for marketing managers

Ali¹,

Li²,

Yang³

et al. 2020

PLoS ONE

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Firms need sufficient resources (tangible and intangible) and capabilities to build unique products due to customers' demands and choices, market competition and globalization. Despite sufficient resources, many firms cannot build new products according to the customers' preferences and market trends due to lack of marketing capabilities, lack of skilled marketing staff and lack of experienced managers. However, studies have not yet examined what types of intangible skills of marketing managers are prominent for building new products. This study examines the importance of the intangible skills; intellectual captial, financial literacy and business experience in new product development that results in sustainable competitive performance. We used a mixed-method approach; questionnaire (283) and interviews (16) for data collection and then applied structural equation modelling for testing the hypotheses. The results revealed that all the three intangible skills; intellectual captial, financial literacy and business experience significant influence new product development and sustainable competitive performance. However, considering the relative importance, financial literacy and intellectual capital are the most significant predictors of sustainable competitive performance and new product development respectively. Moreover, new product development fully mediates the path between intellectual capital and sustainable competitive performance while it partially mediates the link between financial literacy, business experience and sustainable competitive performance. Considering the importance of tangible resources, our study scrutinized that financial resources have a significant influence on new product development and sustainable competitive performance while technological resources do not play a significant role. This research recommends firms to emphasize on the improvement of intangible skills of the managers in order to build new products that result in sustainable competitive position. This study also recommends marketing managers to improve their financial skills and experience by participating in various seminars and workshops that can spur their new idea generation and new product development capabilities.

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“…That is, knowledge should be regarded as a hereditary factor in order for firms to preserve their sustainability [44] and apply sustainability management tools [141]. In such regard, for practitioners, further improving what and how much of the knowledge asset that the firm captures should be regarded as an essential factor for a firm's CBMA sustainability, because the increased accumulation of knowledge creates an opportunity for firms to achieve further growth [142,143]. In addition, theories of absorptive capacity also state that firms are inclined towards bolstering their competitiveness via absorbing external strategic assets.…”

Section: Managerial Implicationsmentioning

confidence: 99%

Acquirer’s Absorptive Capacity and Firm Performance: The Perspectives of Strategic Behavior and Knowledge Assets

2020

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In this study, we underline the importance of the relationship between absorptive capacity and an acquiring firm’s post-merger performance following the acquisition of a target firm’s knowledge through cross-border mergers and acquisitions (CBMAs). We analyzed CBMAs between developed countries to highlight how realized absorptive capacity plays a crucial part in a firm’s achievement of CBMA sustainability. Using United States CBMA transactions with other developed countries during 2000–2014, our findings suggest that an acquiring firm’s greater absorptive capacity leads to better post-merger performance. More interestingly, compared to for domestic M&As, the direct effect between absorptive capacity and post-merger performance was found to be more positively related in CBMA transactions, even when we applied propensity-score matching (PSM) and Heckman’s selection model to the same estimation. In addition, we introduce four moderating variables that could either intensify or lessen a firm’s effort to seek external knowledge for organizational growth. In terms of an acquiring firm’s strategic behavior, we find that paying in cash and past CBMA experiences positively influence a firm’s post-merger performance. For a target firm’s knowledge assets, we show that when a target firm possesses more strategic assets, they reinforce the acquiring firm’s post-merger performance, and when the target firm is in a high-tech industry, the acquiring firm’s post-merger performance is weakened. Our study contributes to the CBMA literature by incorporating the concept of a knowledge-based view and by empirically testing the different effects of absorptive capacity between domestic M&A and CBMA and how both strategic behavior and a target firm’s knowledge assets affect a firm’s post-merger performance related to CBMA sustainability.

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Effects of knowledge accumulation strategies through experience and experimentation on firm growth

Cited by 34 publications

References 62 publications

Business experience or Financial Literacy? Which one is better for opportunity recognition and superior performance?

Business experience or Financial Literacy? Which one is better for opportunity recognition and superior performance?

Unpacking the importance of intangible skills in new product development and sustainable business performance; strategies for marketing managers

Acquirer’s Absorptive Capacity and Firm Performance: The Perspectives of Strategic Behavior and Knowledge Assets

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